Posted by: John | October 29, 2008

Guardian turns against Brown

http://www.guardian.co.uk/commentisfree/2008/oct/29/economy-labour-recession-gordon-brown

The final paragraph interests me:

And after the deluge, what then? It would be nice to report that lessons have been learned and that the future promises tougher controls on credit creation, the renaissance of the industrial base to meet the environmental challenge, the permanent cageing of the City. But do you honestly believe that is going to happen, whoever is in charge? No, me neither.

Do we have any answers? For the short term there are no rules that cannot be broken it’s true – what about the long-term?

I believe WE DO NEED TOUGHER CONTROLS ON CREDIT CREATION

Do we?

I believe THAT THESE CONTROLS HAVE TO BE MEANINGFUL – ie tough on consumer credit and mortgages

The only answer is to spell out to the British people a new contract between banking and credit – otherwise we are in danger of the Conservatives winning on arguments to problems they helped create. Those that have racked up huge credit will continue either voting Labour or might, out of the new austerity turn to us. Those that HAVEN’T bought in to the bubble may well regard Vince as a great man and our party `on the side of ordinary people` but until they see that we acknowledge their principles they may turn to the Tories in high numbers. I’m not talking about the rich kids here I’m talking about Joe and Joanne Soap who sacrificed the holidays and the larger house in order to remain on an even keel. They want to see a Party whose long term ambitions are for the country to have stable finances on that same even keel.

Thus, we need to give short, medium and long-term answers to these questions. Short-term on the crisis, medium term for how we’re going to try and sort out the mess and long-term what vision do we have about individuals and their money. We seem to be doing the first two but what about the third?

It’s very tough though I trust Vince Cable more than anyone to spell it out. Tough because it’ll mean bearing down on the banks and effectively cageing the City around the Government’s agenda and tough because it’ll be simply stating things about which the electorate is looking askance – that the real economy holds a lot less REAL value than the `fantasyland` economy of the past 11 years suggests. That means consequences for both banks and consumers.

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